Equinix’s $800 Million Acquisition of Infomart Data Centers’ Dallas operations

Equinix was advised on the transaction by Citi, J.P. Morgan and Davis Polk & Wardwell LLP. DLA Piper represented ASB Capital Management LLC

Equinix, Inc. (Nasdaq: EQIX), the global interconnection and data center company, today announced it has entered into a definitive agreement to acquire the Infomart Dallas, including its operations and tenants, from ASB Real Estate Investments, in an $800 million debt and cash transaction.

The acquisition of this landmark facility and tenants will further strengthen the Equinix global platform. The Infomart is one of the largest interconnection hubs in the U.S. and is currently home to four of eight Equinix Dallas International Business Exchange™ (IBX®) data centers (DA1, DA2, DA3 and DA6), which combined, support approximately 3,500 built out cabinets. As a result of this transaction, Equinix will increase the number of its owned assets by four, increasing recurring revenue from owned assets to more than 45 percent. The acquisition will also secure the ability to further expand in the Dallas market with future development, and is expected to expand the important role Equinix plays in helping companies evolve from traditional businesses to digital businesses by globally interconnecting with the people, locations, cloud services and data that are critical to their operations.

The transaction is expected to close by mid-2018, subject to the satisfaction of customary closing conditions. As part of the deal, approximately 50 Infomart employees and contractors, primarily in the operations functions of the acquired facility, will become Equinix employees or contractors.

The financial terms of the deal include cash consideration of $31 million combined with $750 million in senior unsecured notes issued to ASB at various maturities over 36 months after the closing date. The notes will be valued at approximately $769 million when adjusted to reflect the current trading value of Equinix currently outstanding bonds.

The Davis Polk corporate team includes partners Alan F. Denenberg (Picture) and Stephen Salmon and associates Jeffrey C. Lau, Emily Roberts and Katherine Schloss Ackerman. Partner Rachel D. Kleinberg and associate Caroline E. Dayton are providing tax advice. Counsel Michelle Ontiveros Gross is providing intellectual property and technology advice. Counsel Ron M. Aizen and associate Rina Fujii are providing executive compensation advice.

DLA Piper represented ASB Capital Management LLC with Joe Alexander (Miami) and partners Brian Gordon, Daniel Rollman (both Atlanta), Barbara Trachtenberg (Boston), Robert LeDuc (Minneapolis), Jamie Knox (New York), Nathaniel McKitterick (Silicon Valley), Julia Kovacs (Washington, DC), Joseph Langhirt (Baltimore) and Jamie Konn (Atlanta).

Involved fees earner: Alan Denenberg – Davis Polk & Wardwell; Stephen Salmon – Davis Polk & Wardwell; Jeffrey Lau – Davis Polk & Wardwell; Emily Roberts – Davis Polk & Wardwell; Katherine Schloss Ackerman – Davis Polk & Wardwell; Rachel Kleinberg – Davis Polk & Wardwell; Caroline Dayton – Davis Polk & Wardwell; Michelle Ontiveros Gross – Davis Polk & Wardwell; Ron M. Aizen – Davis Polk & Wardwell; Rina Fujii – Davis Polk & Wardwell; Joseph Alexander – DLA Piper; Brian Gordon – DLA Piper; Daniel Rollman – DLA Piper; Barbara Trachtenberg – DLA Piper; Robert LeDuc – DLA Piper; Joseph Langhirt – DLA Piper; Jamie Knox – DLA Piper; Nathaniel McKitterick – DLA Piper; Julia Kovacs – DLA Piper; Jamie Konn – DLA Piper;

Law Firms: Davis Polk & Wardwell; DLA Piper;

Clients: Equinix; ASB Capital Management LLC ;

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Author: Ambrogio Visconti